Why Should Marketing Companies Consider Employee Ownership?


Thinking about introducing employee ownership within your marketing company? This article will give you some reasons why this might be a good idea.

Employee ownership is when your employees take a share in the company profits. There are various ways this can be done – either through Share Incentive Plans (SIPs), Save As You Earn (SAYE), a Company Share Option Plan, Enterprise Management Incentives (EMIs), or Enterprise Ownership Trusts (EOTs). The question is, is the right choice for your marketing company?

You can read about the benefits of employee ownership in various places, but in this article, we’re going to give you the main pointers to take away with you. Here are a number of the many benefits that employee ownership can provide you and your company.

  1. Allows Employees to Have Their Say in the Business

First and foremost, employee ownership gives every employee a say in how the business runs. As a company owner, this might not immediately seem like a win-win for you. That said, the various other benefits we’ll list below are directly influenced by this first point.

  1. Improves Business Transparency

As you would in a shareholder meeting for a regular company, employee ownership means each of your employees who own a stake will be involved in any meetings too. These meetings could include general ongoings in the company, as well as the big decisions.

Having your employees in on these meetings is a sure way to develop a culture of transparency throughout the business. It means that employees will become invested in the direction of the company, leading to a more loyal and motivated workforce.

  1. Can Make Employees More Motivated

With employees having a personal stake in the company, there’s no doubt that they are more likely to be motivated in their day-to-day roles. This is because they are invested in the outcome of the company; the more money the company makes the greater their pay-out.

  1. Your Company Will Receive Feedback from Everyone

Building your own company is an impressive feat, but there comes a point when one person’s views and opinions may not suffice. After all, the beauty of human nature is that we can learn from one another in all aspects of life. The same goes for the business world.

Employee ownership helps with this; it gives you the ability to call upon each and every one of your employees for any decisions, big or small. Of course, you could do this with any business, but with the employee ownership model, your employees have a vested interest in the outcome of the business.

This means that any decisions that are made will involve a varied group of opinions and views form the huge variety of shareholders. This is sure to benefit your business through gaining perspective from each employee, who will come from different departments and backgrounds.

  1. Tax Benefits

The benefits of employee ownership don’t just stop with the emotional and business side of things. In fact, the monetary benefits for the business and its employees speak for themselves.

This is because, in an effort to encourage more businesses to become employee owned, the UK government introduced various tax incentives. In the UK, if the company is signed up to one of the government’s employee ownership schemes, some of the tax benefits include:

  • Employees not having to pay Income Tax or National Insurance on their shares of the company.
  • You can get up to £3,000 of free shares every year, tax-free, if your shares are drawn after 5 years.
  • Employees can buy up to £1,500 of “Partnership Shares” (max 10 percent of their salary) each year, obtaining tax relief on the purchase.
  1. No Issues with Take Overs

In the average business, when a company owner or shareholder leaves, there may be a whole debacle regarding the successor. With employee ownership, this entire saga is eradicated. Instead, the employees own the business as before, and can make a collective decision as to the new direction.

  1. Attracts and Retains Employees

In the grand scheme of things, not many companies are employee owned yet – only a select few are. This means that employee ownership adds an extra level of benefits for any potential employee. Not only does this help attract new talent, it also serves to retain the current employees, who may not get the same opportunities elsewhere.

  1. Ultimately Improves Company Culture

Overall, the above benefits all have the same effect in that they are likely to lead to an improved company culture all-round. But why is this important?

A good company culture has many benefits, including improved communication, customer satisfaction and revenue, as well as happier employees, amongst other things. During the working day, this is much more likely to lead to loyal employees who are motivated, and work together like a well-oiled machine. Again, this is likely to lead to retained employees who can become a strong force to be reckoned with.

Think Your Marketing Company Could Benefit from Employee Ownership?

As you can see, the benefits of employee ownership for any company are stark. For a marketing company, it could be a great move for improving motivation and creativity amongst employees.

It may even have the added benefit of bringing the various teams within your company closer together. This is never a bad thing when it comes to ensuring your teams, as a whole, work like clockwork to deliver the best work.

The question is, do you think this would benefit your marketing company? Be sure to leave your thoughts in the comments down below.

Please be advised that this article is for general informational purposes only, and should not be used as a substitute for advice from a trained business or financial professional. Be sure to consult a business or financial professional if you’re seeking advice on setting up employee ownership. We are not liable for risks or issues associated with using or acting upon the information on this site.